Introduction to sunspots and lotteries

Edward C. Prescott, Karl Shell

Research output: Contribution to journalArticle

10 Scopus citations

Abstract

This introduces the symposium on sunspots and lotteries. Two stochastic general-equilibrium concepts, sunspot equilibrium (SE) and lottery equilibrium (LE), are compared. It is shown that, for some general, pure-exchange economies which allow for consumption nonconvexities or moral hazards, the set of LE allocations is equivalent to the set of SE allocations provided that the randomizing device can generate events of any probability. Journal of Economic Literature Classification Numbers: D51, D82, D84, E32.

Original languageEnglish (US)
Pages (from-to)1-10
Number of pages10
JournalJournal of Economic Theory
Volume107
Issue number1
DOIs
StatePublished - Nov 1 2002
Externally publishedYes

ASJC Scopus subject areas

  • Economics and Econometrics

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